LONDON/SINGAPORE—Global shares rose on Tuesday, after the rescue of Credit Suisse arrested a rout in bank stocks, but signs of stress in the financial system are making investors wonder if another lender may deliver a nasty surprise, and how central banks might respond.
The Federal Reserve begins a two-day meeting later in the day and after a wild few sessions, U.S. interest rate futures pricing implies that a peak in rates is either imminent or has already been reached.
Many investors had thought concerns about the stability of the banking sector were a thing of the past after the 2008 crisis. But the collapse of a number of U.S. regional lenders, plus the eleventh-hour rescue of Credit Suisse, are forcing central bankers to prioritize fighting inflation alongside keeping money flowing through the financial system….